Sunday, April 17th was the designated moment. The world’s leading oil producers were expected to bring fresh discipline to the chaotic petroleum market and spark a return to high prices.

Meeting in Doha, the glittering capital of petroleum-rich Qatar, the oil ministers of the Organization of the Petroleum Exporting Countries (OPEC), along with such key non-OPEC producers as Russia and Mexico, were scheduled to ratify a draft agreement obliging them to freeze their oil output at current levels.

In anticipation of such a deal, oil prices had begun to creep inexorably upward, from $30 per barrel in mid-January to $43 on the eve of the gathering. But far from restoring the old oil order, the meeting ended in discord, driving prices down again and revealing deep cracks in the ranks of global energy producers.

It is hard to overstate the significance of the Doha debacle. At the very least, it will perpetuate the low oil prices that have plagued the industry for the past two years, forcing smaller firms into bankruptcy and erasing hundreds of billions of dollars of investments in new production capacity. It may also have obliterated any future prospects for cooperation between OPEC and non-OPEC producers in regulating the market.

Most of all, however, it demonstrated that the petroleum-fueled world we’ve known these last decades -- with oil demand always thrusting ahead of supply, ensuring steady profits for all major producers -- is no more. Replacing it is an anemic, possibly even declining, demand for oil that is likely to force suppliers to fight one another for ever-diminishing market shares.

The Road to Doha
Before the Doha gathering, the leaders of the major producing countries expressed confidence that a production freeze would finally halt the devastating slump in oil prices that began in mid-2014. Most of them are heavily dependent on petroleum exports to finance their governments and keep restiveness among their populaces at bay.

Both Russia and Venezuela, for instance, rely on energy exports for approximately 50% of government income,while for Nigeria it’s more like 75%. So the plunge in prices had already cut deep into government spending around the world, causing civil unrest and even in some cases political turmoil.

No one expected the April 17th meeting to result in an immediate, dramatic price upturn, but everyone hoped that it would lay the foundation for a steady rise in the coming months. The leaders of these countries were well aware of one thing: to achieve such progress, unity was crucial.

Otherwise they were not likely to overcome the various factors that had caused the price collapsein the first place. Some of these were structural and embedded deep in the way the industry had been organized; some were the product of their own feckless responses to the crisis.

On the structural side, global demand for energy had, in recent years, ceased to rise quickly enough to soak up all the crude oil pouring onto the market, thanks in part to new supplies from Iraq and especially from the expanding shale fields of the United States.

This oversupply triggered the initial 2014 price drop when Brent crude -- the international benchmark blend -- went from a high of $115 on June 19th to $77 on November 26th, the day before a fateful OPEC meeting in Vienna. The next day, OPEC members, led by Saudi Arabia, failed to agree on either production cuts or a freeze, and the price of oil went into freefall.

The failure of that November meeting has been widely attributed to the Saudis’ desire to kill off new output elsewhere -- especially shale production in the United States -- and to restore their historic dominance of the global oil market. Many analysts were also convinced that Riyadh was seeking to punish regional rivals Iran and Russia for their support of the Assad regime in Syria (which the Saudis seek to topple).

The rejection, in other words, was meant to fulfill two tasks at the same time: blunt or wipe out the challenge posed by North American shale producersand undermine two economically shaky energy powers that opposed Saudi goals in the Middle East by depriving them of much needed oil revenues.

Because Saudi Arabia could produce oil so much more cheaply than other countries -- for as little as $3 per barrel -- and because it could draw upon hundreds of billions of dollars in sovereign wealth funds to meet any budget shortfalls of its own, its leaders believed it more capable of weathering any price downturn than its rivals.

Today, however, that rosy prediction is looking grimmer as the Saudi royals beginto feel the pinch of low oil prices, and find themselves cutting back on the benefits they had been passing on to an ever-growing, potentially restive population while still financing a costly, inconclusive, and increasingly disastrous war in Yemen.

Many energy analysts became convinced that Doha would prove the decisive moment when Riyadh would finally be amenable to a production freeze. Just days before the conference, participants expressed growing confidencethat such a plan would indeed be adopted.

After all, preliminary negotiations between Russia, Venezuela, Qatar, and Saudi Arabia had produced a draft document that most participants assumed was essentially ready for signature. The only sticking point: the nature of Iran’s participation.

The Iranians were, in fact, agreeable to such a freeze, but only after they were allowed to raise their relatively modest daily output to levels achievedin 2012 before the West imposed sanctions in an effort to force Tehran to agree to dismantle its nuclear enrichment program. Now that those sanctions were, in fact, being lifted as a result of the recently concluded nuclear deal, Tehran was determined to restore the status quo ante.

On this, the Saudis balked, having no wish to see their arch-rival obtain added oil revenues. Still, most observers assumed that, in the end, Riyadh would agree to a formula allowing Iran some increase before a freeze.

“There are positive indications an agreement will be reached during this meeting... an initial agreement on freezing production,” said Nawal Al-Fuzaia, Kuwait’s OPEC representative, echoing the views of other Doha participants.

But then something happened. According to people familiar with the sequence of events, Saudi Arabia’s Deputy Crown Prince and key oil strategist, Mohammed bin Salman, called the Saudi delegation in Doha at 3:00 a.m. on April 17th and instructed them to spurn a deal that provided leeway of any sort for Iran.

When the Iranians -- who chose not to attend the meeting -- signaled that they had no intention of freezing their output to satisfy their rivals, the Saudis rejected the draft agreement it had helped negotiate and the assembly ended in disarray.

Geopolitics to the Fore
Most analysts have since suggested that the Saudi royals simply considered punishing Iran more important than raising oil prices. No matter the cost to them, in other words, they could not bring themselves to help Iran pursue its geopolitical objectives, including giving yet more support to Shiite forces in Iraq, Syria, Yemen, and Lebanon.

Already feeling pressured by Tehran and ever less confident of Washington’s support, they were ready to use any means available to weaken the Iranians, whatever the danger to themselves.

“The failure to reach an agreement in Doha is a reminder that Saudi Arabia is in no mood to do Iran any favors right now and that their ongoing geopolitical conflict cannot be discounted as an element of the current Saudi oil policy,” said Jason Bordoff of the Center on Global Energy Policy at Columbia University.

Many analysts also pointed to the rising influence of Deputy Crown Prince Mohammed bin Salman, entrusted with near-total control of the economy and the military by his aging father, King Salman. As Minister of Defense, the prince has spearheaded the Saudi drive to counter the Iranians in a regional struggle for dominance.

Most significantly, he is the main force behind Saudi Arabia’s ongoing intervention in Yemen, aimed at defeating the Houthi rebels, a largely Shia group with loose ties to Iran, and restoring deposed former president Abd Rabbuh Mansur Hadi.

After a year of relentless U.S.-backed airstrikes (including the use of cluster bombs), the Saudi intervention has, in fact, failed to achieve its intended objectives, though it has produced thousands of civilian casualties, provoking fierce condemnation from U.N. officials, and created space for the rise of al-Qaeda in the Arabian Peninsula. Nevertheless, the prince seems determined to keep the conflict going and to counter Iranian influence across the region.

For Prince Mohammed, the oil market has evidently become just another arena for this ongoing struggle. “Under his guidance,” the Financial Timesnoted in April, “Saudi Arabia’s oil policy appears to be less driven by the price of crude than global politics, particularly Riyadh’s bitter rivalry with post-sanctions Tehran.”

This seems to have been the backstory for Riyadh’s last-minute decision to scuttle the talks in Doha. On April 16th, for instance, Prince Mohammed couldn’t have been blunter to Bloomberg, even if he didn’t mention the Iranians by name: “If all major producers don’t freeze production, we will not freeze production.”

With the proposed agreement in tatters, Saudi Arabia is now expected to boost its own output, ensuring that prices will remain bargain-basement low and so deprive Iran of any windfall from its expected increase in exports.

The kingdom, Prince Mohammed toldBloomberg, was prepared to immediately raise production from its current 10.2 million barrels per day to 11.5 million barrels and could add another million barrels “if we wanted to” in the next six to nine months.

With Iranian and Iraqi oil heading for market in larger quantities, that’s the definition of oversupply. It would certainly ensure Saudi Arabia’s continued dominance of the market, but it might also wound the kingdom in a major way, if not fatally.

A New Global Reality
No doubt geopolitics played a significant role in the Saudi decision, but that’s hardly the whole story.

Overshadowing discussions about a possible production freeze was a new fact of life for the oil industry: the past would be no predictor of the future when it came to global oil demand. Whatever the Saudis think of the Iranians or vice versa, their industry is being fundamentally transformed, altering relationships among the major producers and eroding their inclination to cooperate.

Until very recently, it was assumed that the demand for oil would continue to expand indefinitely, creating space for multiple producers to enter the market, and for ones already in it to increase their output.

Even when supply outran demand and drove prices down, as has periodically occurred, producers could always take solace in the knowledge that, as in the past, demand would eventually rebound, jacking prices up again. Under such circumstances and at such a moment, it was just good sense for individual producers to cooperate in lowering output, knowing that everyone would benefit sooner or later from the inevitable price increase.

But what happens if confidence in the eventual resurgence of demand begins to wither? Then the incentives to cooperate begin to evaporate, too, and it’s every producer for itself in a mad scramble to protect market share.

This new reality -- a world in which “peak oil demand,” rather than “peak oil,” will shape the consciousness of major players -- is what the Doha catastrophe foreshadowed.

At the beginning of this century, many energy analysts were convinced that we were at the edge of the arrival of “peak oil”; a peak, that is, in the output of petroleum in which planetary reserves would be exhausted long before the demand for oil disappeared, triggering a global economic crisis. As a result of advances in drilling technology, however, the supply of oil has continued to grow, while demand has unexpectedly begun to stall.

This can be traced both to slowing economic growth globally and to an accelerating “green revolution” in which the planet will be transitioning to non-carbon fuel sources. With most nations now committed to measures aimed at reducing emissions of greenhouse gases under the just-signed Paris climate accord, the demand for oil is likely to experience significant declines in the years ahead. In other words, global oil demand will peak long before supplies begin to run low, creating a monumental challenge for the oil-producing countries.

This is no theoretical construct. It’s reality itself. Net consumption of oil in the advanced industrialized nations has already dropped from 50 million barrels per day in 2005 to 45 million barrels in 2014. Further declines are in store as strict fuel efficiency standards for the production of new vehicles and other climate-related measures take effect, the price of solar and wind power continues to fall, and other alternative energy sources come on line.

While the demand for oil does continue to rise in the developing world, even there it’s not climbing at rates previously taken for granted. With such countries also beginning to impose tougher constraints on carbon emissions, global consumption is expected to reach a peak and begin an inexorable decline. According to experts Thijs Van de Graaf and Aviel Verbruggen, overall world peak demand could be reached as early as 2020.

In such a world, high-cost oil producers will be driven out of the market and the advantage -- such as it is -- will lie with the lowest-cost ones. Countries that depend on petroleum exports for a large share of their revenues will come under increasing pressure to move away from excessive reliance on oil.

This may have been another consideration in the Saudi decision at Doha. In the months leading up to the April meeting, senior Saudi officials dropped hints that they were beginning to plan for a post-petroleum era and that Deputy Crown Prince bin Salman would play a key role in overseeing the transition.

On April 1st, the prince himself indicated that steps were underway to begin this process. As part of the effort, he announced, he was planning an initial public offering of shares in state-owned Saudi Aramco, the world’s number one oil producer, and would transfer the proceeds, an estimated $2 trillion, to its Public Investment Fund (PIF).

“IPOing Aramco and transferring its shares to PIF will technically make investments the source of Saudi government revenue, not oil,” the prince pointed out. “What is left now is to diversify investments. So within 20 years, we will be an economy or state that doesn’t depend mainly on oil.”

For a country that more than any other has rested its claim to wealth and power on the production and sale of petroleum, this is a revolutionary statement. If Saudi Arabia says it is ready to begin a move away from reliance on petroleum, we are indeed entering a new world in which, among other things, the titans of oil production will no longer hold sway over our lives as they have in the past.

This, in fact, appears to be the outlook adopted by Prince Mohammed in the wake of the Doha debacle. In announcing the kingdom’s new economic blueprint on April 25th, he vowed to liberate the country from its “addiction” to oil.” This will not, of course, be easy to achieve, given the kingdom’s heavy reliance on oil revenues and lack of plausible alternatives.

The 30-year-old prince could also face opposition from within the royal family to his audacious moves (as well as his blundering ones in Yemen and possibly elsewhere). Whatever the fate of the Saudi royals, however, if predictions of a future peak in world oil demand prove accurate, the debacle in Doha will be seen as marking the beginning of the end of the old oil order.

• Michael T. Klare, a TomDispatch regular, is a professor of peace and world security studies at Hampshire College and the author, most recently, of The Race for What’s Left. A documentary movie version of his book Blood and Oil is available from the Media Education Foundation. Follow him on Twitter at @mklare1.

That America is in the throes of a systemic health crisis can no longer be denied. According to the U.S. Department of Health And Human Services, more than two-thirds (68.8 percent) of adults are overweight or obese. Overweight is typically defined as a body-mass index (BMI) of 25 or higher.
A BMI of 24.9 is not exactly featherweight; I would have to add 30 pounds to reach a BMI of 24.9.

The health risks of being overweight or obese include:

type 2 diabetes

heart disease

high blood pressure

nonalcoholic fatty liver disease (excess fat and inflammation in the liver of people who drink little or no alcohol)

osteoarthritis (a health problem causing pain, swelling, and stiffness in one or more joints)

some types of cancer: breast, colon, endometrial (related to the uterine lining), and kidney

stroke

Since the early 1960s, the prevalence of obesity among adults more than doubled, increasing from 13.4 to 35.7 percent in U.S. adults age 20 and older. (Source)

The Journal of the American Medical Association (JAMA) reported in 2015 that roughly half of all adult Americans are diabetic or prediabetic (also called metabolic syndrome).

If we add up everyone in America who is either suffering from or at risk of lifestyle-related diseases such as heart disease, diabetes and lifestyle-related types of cancer, it’s clear this is an unprecedented national health crisis that has no easy or cheap medical fix.

Why have we become so unhealthy?

The answers come thick and fast. We are more sedentary as most work is now white-collar; the foods low-income people can afford are unhealthy; children now spend time playing digital games rather than playing outside; serving sizes of sodas and other high-calorie/low nutrition beverages have ballooned; people buy more convenience and fast foods and prepare fewer meals at home, and so on.

Two things are clear: there is no one solution to the epidemic of lifestyle-related diseases. Limiting sodas in schools and demanding better labeling of food are examples of reforms that are well-intended, but have so far had little effect on the expanding waistlines of Americans or their ill-health.

The second is expressed by the Chinese proverb: “Diseases enter through the mouth,” i.e. disease is a result of what we eat and drink. Since what we eat has an enormous impact on our health, if we want to tackle our health crisis in a manner that get results, we must start with what we eat and how our food is grown, processed and prepared.

Once we start examining our diet, we have to examine where our food comes from, how it is grown/raised and how it is processed for consumers.

A second Chinese proverb explains why we must start with diet: “When you’re thirsty, it’s too late to dig a well.” If we want to avoid lifestyle illnesses, we must start pursuing a new way of growing and preparing food now, not after we’re already ill.

The long lists of contributory factors to our growing ill-health distract us from the real source of our national health crisis: our food/illness/healthcare system is sick, and so it’s no wonder we’re sick, too. The only possible result of our unhealthy food/illness/healthcare care system is ill-health.
Understanding the Food / Illness / Healthcare SystemTo understand why this is so, we must start with the fact that we live in a highly centralized government/private-sector system that limits our choices to maximize the profits of corporate cartels.

Big Agriculture, Big Oil-Ag Chemicals, Big GMO seeds (Monsanto et al.), Big Processed Foods, Big Supermarkets, Big Fast Food, Big Healthcare (what I have called sickcare for many years, because profits flow not from keeping us healthy via prevention but from keeping us alive when we’re suffering from chronic lifestyle illnesses) and last but not least Big Pharma, which is happy to provide medications that costs tens of thousands of dollars per patient per year to address the symptoms of lifestyle diseases rather than the causes, which trace back to what we eat and how we live.

Once you hear an alternative account of how we could be raising food and delivering it to consumers to prepare at home, you grasp the sickening stranglehold Corporate America and government agencies have on our food, diet and the resulting epidemic of ill-health.

I was fortunate to attend a permaculture conference, 'Better Soil, Better Food...A Better World' at Tara Firma Farms in Petaluma, California this past weekend that Adam Taggart (co-founder of Peak Prosperity) was responsible for producing.

Though these connections are common sense—we all know about garbage in, garbage out—the linkage between our extractive, monoculture agriculture and all the other subsystems of food and health remains opaque to most Americans.

Centralized Systems Are Hijacked By Those Who Profit Most From Them

Centralized systems are inevitably hijacked by vested interests in a way that is simply not possible in highly decentralized systems. Powerful vested interests rig centralized systems to protect and extend their privileges and profits. This dynamic is a positive (self-reinforcing) feedback loop: the greater the centralization, the greater the influence of vested interests, who increase the centralization that benefits them.

Though it is poorly understood by conventional economists and political scientists, centralization makes it inevitable that the interests that benefit most from centralization (corporations) will serve their self-interests by gaining control of centralized power via lobbying and political contributions.

Once entrenched interests have purchased influence over politicians and regulatory agencies, they use the power of centralized government to limit competition by erecting regulatory barriers. The regulatory system is soon approving whatever reaps the most profit for the big corporations and restricting alternatives to corporate products.

Before centralized federal and state government agencies and big corporations became dominant, decentralized family-owned farms and grocery stores were the norm. Anyone seeking to control the entire sector faced an essentially impossible task.

Now, a handful of corporations control key sectors of the food/healthcare complex: seeds, chemical fertilizers, processing of food into consumer products, distribution to consumers via grocery chains and the fast-food industry, and the healthcare/pharmaceutical sectors.

This concentration of power over our food and health is presented as the lowest-cost and most efficient system possible: concentrated ownership and control, we’re told, enables vast economies of scale that lower the cost to consumers. While this might be true of grains, it is not true of healthcare.

And since food and health are causally connected, we have to consider the total system costs: not just the cost at the grocery store or fast-food outlet, but the eventual costs of low-quality food and an unhealthy diet.

Once we consider total system costs, we have to include healthcare: the American healthcare system is the most expensive per capita on the planet, over-delivering costly (and often questionable or needless) tests, procedures and medications, and under-delivering affordable preventative care and well-being.

While it’s impossible to break out the eventual system costs of poor diet, the preponderance of lifestyle-related diseases that end up being treated suggest the percentage of healthcare related to diet and lifestyle (fitness, sufficient sleep, etc.) is substantial.

Though the mainstream media paints skyrocketing healthcare costs as the result of costly new technologies and drugs, the unspoken reality is that higher costs also reflect cartels being able to raise prices without fear of competition and the declining health of Americans.

Though the naked eye could not possibly discern the consequences of this monoculture mode of growing tomatoes, studies have found that each acre of tilled bare soil loses tons of topsoil to erosion of wind and rain every year.

As for the nutritional content of the tomatoes: as an experiment, we took some of the fallen tomatoes home to see if they ever ripened enough to become soft. They never did; they remained hard and tasteless, even in a bowl of fruit that naturally emitted ripening ethylene.

What was the nutritional content of this tasteless product of monoculture? Only a lab test could tell, but it was a good bet the nutritional content was as poor as the taste.

These indestructible tasteless tomatoes were undoubtedly bred to become tomato sauce in some distant processing plant, bound for wholesalers and retailers who end up taking most of the consumers’ dollar.

It Doesn’t Have To Be This Way

It doesn’t have to be this way. Regenerative agricultural practices actually build soils rather than strip-mining them. Consumer-supported agriculture (CSA) cuts out the corporate middlemen and delivers high-quality food directly to consumers.

If we consider that Americans throw away 40% of all food they purchase, it’s not hard to see another option: waste nothing and spend the savings on higher quality food.

My time this past weekend with Joel Salatin, Toby Hemenway and the folks from Singing Frogs Farm was filled with compelling yet practical steps each of us can and should take in our lives to take more control over our health -- in ways that are easy, enjoyable and result in big improvements to our quality of life.

We Could Be Witnessing the Death of the Fossil Fuel Industry—Will It Take the Rest of the Economy Down With It?

It’s not looking good for the global fossil fuel industry. Although the world remains heavily dependent on oil, coal and natural gas—which today supply around 80 percent of our primary energy needs—the industry is rapidly crumbling.

This is not merely a temporary blip, but a symptom of a deeper, long-term process related to global capitalism’s escalating overconsumption of planetary resources and raw materials.

New scientific research shows that the growing crisis of profitability facing fossil fuel industries is part of an inevitable period of transition to a post-carbon era.

But ongoing denialism has led powerful vested interests to continue clinging blindly to their faith in fossil fuels, with increasingly devastating and unpredictable consequences for the environment.

Bankruptcy epidemic

In February, the financial services firm Deloitte predicted that over 35 percent of independent oil companies worldwide are likely to declare bankruptcy, potentially followed by a further 30 percent next year—a total of 65 percent of oil firms around the world. Since early last year, already 50 North American oil and gas producers have filed bankruptcy.

The cause of the crisis is the dramatic drop in oil prices—down by two-thirds since 2014—which are so low that oil companies are finding it difficult to generate enough revenue to cover the high costs of production, while also repaying their loans.

Oil and gas companies most at risk are those with the largest debt burden. And that burden is huge—as much as $2.5 trillion, according to The Economist. The real figure is probably higher.

At a speech at the London School of Economics in February, Jaime Caruana of the Bank for International Settlements said that outstanding loans and bonds for the oil and gas industry had almost tripled between 2006 and 2014 to a total of $3 trillion.

This massive debt burden, he explained, has put the industry in a double-bind: In order to service the debt, they are continuing to produce more oil for sale, but that only contributes to lower market prices. Decreased oil revenues means less capacity to repay the debt, thus increasing the likelihood of default.

Stranded assets

This $3 trillion of debt is at risk because it was supposed to generate a 3-to-1 increase in value, but instead—thanks to the oil price decline—represents a value of less than half of this.

Worse, according to a Goldman Sachs study quietly published in December last year, as much as $1 trillion of investments in future oil projects around the world are unprofitable; i.e., effectively stranded.

Examining 400 of the world’s largest new oil and gas fields (except U.S. shale), the Goldman study found that $930 billion worth of projects (more than two-thirds) are unprofitable at Brent crude prices below $70. (Prices are now well below that.)

The collapse of these projects due to unprofitability would result in the loss of oil and gas production equivalent to a colossal 8 percent of current global demand. If that happens, suddenly or otherwise, it would wreck the global economy.

The Goldman analysis was based purely on the internal dynamics of the industry. A further issue is that internationally-recognized climate change risks mean that to avert dangerous global warming, much of the world’s remaining fossil fuel resources cannot be burned.

All of this is leading investors to question the wisdom of their investments, given fears that much of the assets that the oil, gas and coal industries use to estimate their own worth could consist of resources that will never ultimately be used.

The Carbon Tracker Initiative, which analyzes carbon investment risks, points out that over the next decade, fossil fuel companies risk wasting up to $2.2 trillion of investments in new projects that could turn out to be “uneconomic” in the face of international climate mitigation policies.

More and more fossil fuel industry shareholders are pressuring energy companies to stop investing in exploration for fear that new projects could become worthless due to climate risks.

“Clean technology and climate policy are already reducing fossil fuel demand,” said James Leaton, head of research at Carbon Tracker. “Misreading these trends will destroy shareholder value. Companies need to apply 2C stress tests to their business models now.”

At the time, the industry scoffed at such a bold pronouncement. Six months after this report was released—a week ago—Peabody went bankrupt. Who’s next?

The Carbon Tracker analysis may underestimate the extent of potential losses. A new paper just out in the journal Applied Energy, from a team at Oxford University’s Institute for New Economic Thinking, shows that the “stranded assets” concept applies not just to unburnable fossil fuel reserves, but also to a vast global carbon-intensive electricity infrastructure, which could be rendered as defunct as the fossil fuels it burns and supplies to market.

The coming debt spiral

Some analysts believe the hidden trillion-dollar black hole at the heart of the oil industry is set to trigger another global financial crisis, similar in scale to the Dot-Com crash.

Jason Schenker, president and chief economist at Prestige Economics, says: “Oil prices simply aren’t going to rise fast enough to keep oil and energy companies from defaulting. Then there is a real contagion risk to financial companies and from there to the rest of the economy.”

Schenker has been ranked by Bloomberg News as one of the most accurate financial forecasters in the world since 2010. The US economy, he forecasts, will dip into recession at the end of 2016 or early 2017.

Mark Harrington, an oil industry consultant, goes further. He believes the resulting economic crisis from cascading debt defaults in the industry could make the 2007-8 financial crash look like a cakewalk. “Oil and gas companies borrowed heavily when oil prices were soaring above $70 a barrel,” he wrote on CNBC in January.

“But in the past 24 months, they’ve seen their values and cash flows erode ferociously as oil prices plunge—and that’s made it hard for some to pay back that debt. This could lead to a massive credit crunch like the one we saw in 2008. With our economy just getting back on its feet from the global 2008 financial crisis, timing could not be worse.”

Ratings agency Standard & Poor (S&P) reported this week that 46 companies have defaulted on their debt this year—the highest levels since the depths of the financial crisis in 2009. The total quantity in defaults so far is $50 billion.

Half this year’s defaults are from the oil and gas industry, according to S&P, followed by the metals, mining and the steel sector. Among them was coal giant Peabody Energy.

But it’s probably worse. Confidential Wall Street sources claim that the Federal Reserve in Dallas has secretly advised major U.S. banks in closed-door meetings to cover-up potential energy-related losses. The Federal Reserve denies the allegations, but refuses to respond to Freedom of Information requests on internal meetings, on the obviously false pretext that it keeps no records of any of its meetings.

According to Bronka Rzepkoswki of the financial advisory firm Oxford Economics, over a third of the entire U.S. high yield bond index is vulnerable to low oil prices, increasing the risk of a tidal wave of corporate bankruptcies: “Conditions that usually pave the way for mounting defaults—such as growing bad debt, tightening monetary conditions, tightening of corporate credit standards and volatility spikes – are currently met in the U.S.”

The end of cheap oil

Behind the crisis of oil’s profitability that threatens the entire global economy is a geophysical crisis in the availability of cheap oil. Cheap here does not refer simply to the market price of oil, but the total cost of production. More specifically, it refers to the value of energy.

There is a precise scientific measure for this, virtually unknown in conventional economic and financial circles, known as Energy Return on Investment—which essentially quantifies the amount of energy extracted, compared to the inputs of energy needed to conduct the extraction. The concept of EROI was first proposed and developed by Professor Charles A. Hall of the Department of Environmental and Forest Biology at the State University of New York. He found that an approximate EROI value for any energy source could be calculated by dividing the quantity of energy produced by the amount of energy inputted into the production process.

Therefore, the higher the EROI, the more energy that a particular source and technology is capable of producing. The lower the EROI, the less energy this source and technology is actually producing.

A new peer-reviewed study led by the Institute of Physics at the National Autonomous University of Mexico has undertaken a comparative review of the EROI of all the major sources of energy that currently underpin industrial civilization—namely oil, gas, coal, and uranium.

Published in the journal Perspectives on Global Development and Technology, the scientists note that the EROI for fossil fuels has inexorably declined over a relatively short period of time: “Nowadays, the world average value EROI for hydrocarbons in the world has gone from a value of 35 to a value of 15 between 1960 and 1980.”

In other words, in just two decades, the total value of the energy being produced via fossil fuel extraction has plummeted by more than half. And it continues to decline.

This is because the more fossil fuel resources that we exploit, the more we have used up those resources that are easiest and cheapest to extract. This compels the industry to rely increasingly on resources that are more difficult and expensive to get out of the ground, and bring to market.

The EROI for conventional oil, according to the Mexican scientists, is 18. They estimate, optimistically, that: “World reserves could last for 35 or 45 years at current consumption rates.” For gas, the EROI is 10, and world reserves will last around “45 or 55 years.” Nuclear’s EROI is 6.5, and according to the study authors, “The peak in world production of uranium will be reached by 2045.”

The problem is that although we are not running out of oil, we are running out of the cheapest, easiest to extract form of oil and gas. Increasingly, the industry is making up for the shortfall by turning to unconventional forms of oil and gas—but these have very little energy value from an EROI perspective.

The Mexico team examine the EROI values of these unconventional sources, tar sands, shale oil, and shale gas: “The average value for EROI of tar sands is four. Only ten percent of that amount is economically profitable with current technology.”

For shale oil and gas, the situation is even more dire: “The EROI varies between 1.5 and 4, with an average value of 2.8. Shale oil is very similar to the tar sands; being both oil sources of very low quality. The shale gas revolution did not start because its exploitation was a very good idea; but because the most attractive economic opportunities were previously exploited and exhausted.”

In effect, the growing reliance on unconventional oil and gas has meant that, overall, the costs and inputs into energy production to keep industrial civilization moving are rising inexorably.

It’s not that governments don’t know. It’s that decisions have already been made to protect the vested interests that have effectively captured government policymaking through lobbying, networking and donations.

Three years ago, the British government’s Department for International Development (DFID) commissioned and published an in-depth report, “EROI of Global Energy Resources: Status, Trends and Social Implications.” The report went completely unnoticed by the media.

Its findings are instructive: “We find the EROI for each major fossil fuel resource (except coal) has declined substantially over the last century. Most renewable and non-conventional energy alternatives have substantially lower EROI values than conventional fossil fuels.”

The decline in EROI has meant that an increasing amount of the energy we extract is having to be diverted back into getting new energy out, leaving less for other social investments.

This means that the global economic slowdown is directly related to the declining resource quality of fossil fuels. The DFID report warns: “The declining EROI of traditional fossil fuel energy sources and its eventual effect on the world economy are likely to result in a myriad of unforeseen consequences.”

Shortly after this report was released, I met with a senior civil servant at DFID familiar with its findings, who spoke to me on condition of anonymity. I asked him whether this important research had actually impacted policymaking in the department.

“Unfortunately, no,” he told me, shrugging. “Most of my colleagues, except perhaps a handful, simply don’t have a clue about these issues. And of course, despite the report being circulated widely within the department, and shared with other relevant government departments, there is little interest from ministers who appear to be ideologically pre-committed to fracking.”

Peak oil

The driving force behind the accelerating decline in resource quality, hotly denied in the industry, is ‘peak oil.’

An extensive scientific analysis published in February in Wiley Interdisciplinary Reviews: Energy & Environment lays bare the extent of industry denialism. Wiley Interdisciplinary Reviews (WIRES) is a series of high-quality peer-reviewed publications which runs authoritative reviews of the literature across relevant academic disciplines.

The new WIRES paper is authored by Professor Michael Jefferson of the ESCP Europe Business School, a former chief economist at oil major Royal Dutch/Shell Group, where he spent nearly 20 years in various senior roles from Head of Planning in Europe to Director of Oil Supply and Trading. He later became Deputy Secretary-General of the World Energy Council, and is editor of the leading Elsevier science journal Energy Policy.

In his new study, Jefferson examines a recent 1865-page “global energy assessment” (GES) published by the International Institute of Applied Systems Analysis. But he criticized the GES for essentially ducking the issue of ‘peak oil.”

“This was rather odd,” he wrote. “First, because the evidence suggests that the global production of conventional oil plateaued and may have begun to decline from 2005.”

He went on to explain that standard industry assessments of the size of global conventional oil reserves have been dramatically inflated, noting how “the five major Middle East oil exporters altered the basis of their definition of ‘proved’ conventional oil reserves from a 90 percent probability down to a 50 percent probability from 1984. The result has been an apparent (but not real) increase in their ‘proved’ conventional oil reserves of some 435 billion barrels.”

Added to those estimates are reserve figures from Venezuelan heavy oil and Canadian tar sands, bringing up global reserve estimates by a further 440 billion barrels, despite the fact that they are “more difficult and costly to extract” and generally of “poorer quality” than conventional oil.

“Put bluntly, the standard claim that the world has proved conventional oil reserves of nearly 1.7 trillion barrels is overstated by about 875 billion barrels. Thus, despite the fall in crude oil prices from a new peak in June, 2014, after that of July, 2008, the ‘peak oil’ issue remains with us.”

Jefferson believes that a nominal economic recovery, combined with cutbacks in production as the industry reacts to its internal crises, will eventually put the current oil supply glut in reverse. This will pave the way for “further major oil price rises” in years to come.

It’s not entirely clear if this will happen. If the oil crisis hits the economy hard, then the prolonged recession that results could dampen the rising demand that everyone projects. If oil prices thus remain relatively depressed for longer than expected, this could hemorrhage the industry beyond repair.

Eventually, the loss of production may allow prices to rise again. OPEC estimates that investments in oil exploration and development are at their lowest level in six years. As bankruptcies escalate, the accompanying drop in investments will eventually lead world oil production to fall, even as global demand begins to rise.

This could lead oil prices to climb much higher, as rocketing demand—projected to grow 50 percent by 2035—hits the scarcity of production. Such a price spike, ironically, would also be incredibly bad for the global economy, and as happened with the 2007-8 financial crash, could feed into inflation and trigger another spate of consumer debt-defaults in the housing markets.

Even if that happens, the assumption—the hope—is that oil industry majors will somehow survive the preceding cascade of debt-defaults. The other assumption, is that demand for oil will rise.

But as new sources of renewable energy come online at a faster and faster pace, as innovation in clean technologies accelerates, old fossil fuel-centric projections of future rising demand for oil may need to be jettisoned.

Clean energy

According to another new study released in March in Energy Policy by two scientists at Texas A&M University, “Non-renewable energy”—that is “fossil fuels and nuclear power”—“are projected to peak around mid-century ... Subsequent declining non-renewable production will require a rapid expansion in the renewable energy sources (RES) if either population and/or economic growth is to continue.”

The demise of the fossil fuel empire, the study forecasts, is inevitable. Whichever model run the scientists used, the end output was the same: the almost total displacement of fossil fuels by renewable energy sources by the end of the century; and, as a result, the transformation and localization of economic activity.

But the paper adds that to avoid a rise in global average temperatures of 2C, which would tip climate change into the danger zone, 50 percent or more of existing fossil fuel reserves must remain unused.

The imperative to transition away from fossil fuels is, therefore, both geophysical and environmental. On the one hand, by mid-century, fossil fuels and nuclear power will become obsolete as a viable source of energy due to their increasingly high costs and low quality. On the other, even before then, to maintain what scientists describe as a ‘safe operating space’ for human survival, we cannot permit the planet to warm a further 2C without risking disastrous climate impacts.

Staying below 2C, the study finds, will require renewable energy to supply more than 50 percent of total global energy by 2028, “a 37-fold increase in the annual rate of supplying renewable energy in only 13 years.”

While this appears to be a herculean task by any standard, the Texas A&M scientists conclude that by century’s end, the demise of fossil fuels is going to happen anyway, with or without considerations over climate risks:

… the ‘ambitious’ end-of-century decarbonisation goals set by the G7 leaders will be achieved due to economic and geologic fossil fuel limitations within even the unconstrained scenario in which little-to-no pro-active commitment to decarbonise is required… Our model results indicate that, with or without climate considerations, RES [renewable energy sources] will comprise 87–94 percent of total energy demand by the end of the century.

But as renewables have a much lower EROI than fossil fuels, this will “quickly reduce the share of net energy available for societal use.” With less energy available to societies, “it is speculated that there will have to be a reprioritization of societal energetic needs”—in other words, a very different kind of economy in which unlimited material growth underpinned by endless inputs of cheap fossil fuel energy are a relic of the early 21st century.

The 37-fold annual rate of increase in the renewable energy supply seems unachievable at first glance, but new data just released from the Abu Dhabi-based International Renewable Energy Agency shows that clean power is well on its way, despite lacking the massive subsidies behind fossil fuels.

The data reveals that last year, solar power capacity rose by 37 percent. Wind power grew by 17 percent, geothermal by 5 percent and hydropower by 3 percent.

So far, the growth rate for solar power has been exponential. A Deloitte Center for Energy Solutions report from September 2015 noted that the speed and spread of solar energy had consistently outpaced conventional linear projections, and continues to do so.

While the costs of solar power is consistently declining, solar power generation has doubled every year for the last 20 years. With every doubling of solar infrastructure, the production costs of solar photovoltaic (PV) has dropped by 22 percent.

At this rate, according to analysts like Tony Seba—a lecturer in business entrepreneurship, disruption and clean energy at Stanford University—the growth of solar is already on track to go global. With eight more doublings, that’s by 2030, solar power would be capable of supplying 100 percent of the world’s energy needs. And that’s even without the right mix of government policies in place to support renewables.

According to Deloitte, while Seba’s forecast is endorsed by a minority of experts, it remains a real possibility that should be taken seriously. But the firm points out that obstacles remain:

“It would not make economic sense for utility planners to shutter thousands of megawatts of existing generating capacity before the end of its economic life and replace it with new solar generation.”

Yet Deloitte’s study did not account for the escalating crisis in profitability already engulfing the fossil fuel industries, and the looming pressure of stranded assets due to climate risks. As the uneconomic nature of fossil fuels becomes evermore obvious, so too will the economic appeal of clean energy.

Race against time

The question is whether the transition to a post-carbon energy system—the acceptance of the inevitable death of the oil economy—will occur fast enough to avoid climate catastrophe.

Given that the 2C target for a safe climate is widely recognized to be inadequate—scientists increasingly argue that even a 1C rise in global average temperatures would be sufficient to trigger dangerous, irreversible changes to the earth’s climate.

According to a 2011 report by the National Academy of Sciences, the scientific consensus shows conservatively that for every degree of warming, we will see the following impacts: 5-15 percent reductions in crop yields; 3-10 percent increases in rainfall in some regions contributing to flooding; 5-10 percent decreases in stream-flow in some river basins, including the Arkansas and the Rio Grande, contributing to scarcity of potable water; 200-400 percent increases in the area burned by wildfire in the US; 15 percent decreases in annual average Arctic sea ice, with 25 percent decreases in the yearly minimum extent in September.

Even if all CO2 emissions stopped, the climate would continue to warm for several more centuries. Over thousands of years, the National Academy warns, this could unleash amplifying feedbacks leading to the disappearance of the polar ice sheets and other dramatic changes. In the meantime, the risk of catastrophic wild cards “such as the potential large-scale release of methane from deep-sea sediments” or permafrost, is impossible to quantify.

In this context, even if the solar-driven clean energy revolution had every success, we still need to remove carbon that has already accumulated in the atmosphere, to return the climate to safety.

The idea of removing carbon from the atmosphere sounds technologically difficult and insanely expensive. It’s not. In reality, it is relatively simple and cheap.

A new book by Eric Toensmeier, a lecturer at Yale University’s School of Forestry and Environmental Studies, The Carbon Farming Solution, sets out in stunningly accessible fashion how ‘regenerative farming’ provides the ultimate carbon-sequestration solution.

Regenerative farming is a form of small-scale, localised, community-centred organic agriculture which uses techniques that remove carbon from the atmosphere, and sequester it in plant material or soil.

Using an array of land management and conservation practices, many of which have been tried and tested by indigenous communities, it’s theoretically possible to scale up regenerative farming methods in a way that dramatically offsets global carbon emissions.

Toensmeier’s valuable book discusses these techniques, and unlike other science-minded tomes, offers a practical toolkit for communities to begin exploring how they can adopt regenerative farming practices for themselves.

According to the Rodale Institute, the application of regenerative farming on a global scale could have revolutionary results:

Simply put, recent data from farming systems and pasture trials around the globe show that we could sequester more than 100 percent of current annual CO2 emissions with a switch to widely available and inexpensive organic management practices, which we term ‘regenerative organic agriculture’… These practices work to maximize carbon fixation while minimizing the loss of that carbon once returned to the soil, reversing the greenhouse effect.

This has been widely corroborated. For instance, a 2015 study part-funded by the Chinese Academy of Sciences found that “replacing chemical fertilizer with organic manure significantly decreased the emission of GHGs [greenhouse gases].

Yields of wheat and corn also increased as the soil fertility was improved by the application of cattle manure. Totally replacing chemical fertilizer with organic manure decreased GHG emissions, which reversed the agriculture ecosystem from a carbon source… to a carbon sink.”

Governments are catching on, if slowly. At the Paris climate talks, 25 countries and over 50 NGOs signed up to the French government’s ‘4 per 1000’ initiative, a global agreement to promote regenerative farming as a solution for food security and climate disaster.

The birth of post-capitalism

There can be no doubt, then, that by the end of this century, life as we know it on planet earth will be very different. Fossil fueled predatory capitalism will be dead. In its place, human civilization will have little choice but to rely on a diversity of clean, renewable energy sources.

Whatever choices we make this century, the coming generations in the post-carbon future will have to deal with the realities of an overall warmer, and therefore more unpredictable, climate. Even if regenerative processes are in place to draw-down carbon from the atmosphere, this takes time—and in the process, some of the damage climate change will wreak on our oceans, our forests, our waterways, our coasts, and our soils will be irreversible.

It could take centuries, if not millennia, for the planet to reach a new, stable equilibrium.

But either way, the work of repairing and mitigating at least some of the damage done will be the task of our childrens’ children, and their children, and on.

Economic activity in this global society will of necessity be very different to the endless growth juggernaut we have experienced since the industrial revolution. In this post-carbon future, material production and consumption, and technological innovation, will only be sustainable through a participatory ‘circular economy’ in which scarce minerals and raw materials are carefully managed.

The fast-paced consumerism that we take for granted today simply won’t work in these circumstances.

Large top-down national and transnational structures will begin to become obsolete due to the large costs of maintenance, the unsustainability of the energy inputs needed for their survival, and the shift in power to new decentralized producers of energy and food.

In the place of such top-down structures, smaller-scale, networked forms of political, social and economic organization, connected through revolutionary information technologies, will be most likely to succeed. For communities to not just survive, but thrive, they will need to work together, sharing technology, expertise and knowledge on the basis of a new culture of human parity and cooperation.

Of course, before we get to this point, there will be upheaval. Today’s fossil fuel incumbency remains in denial, and is unlikely to accept the reality of its inevitable demise until it really does drop dead.

The escalation of resource wars, domestic unrest, xenophobia, state-militarism, and corporate totalitarianism is to be expected. These are the death throes of a system that has run its course.

The outcomes of the struggles which emerge in coming decades—struggles between people and power, but also futile geopolitical struggles within the old centers of power (paralleled by misguided struggles between peoples)—is yet to be written.

Eager to cling to the last vestiges of existence, the old centers of power will still try to self-maximize within the framework of the old paradigm, at the expense of competing power-centers, and even their own populations.

And they will deflect from the root causes of the problem as much as possible, by encouraging their constituents to blame other power-centers, or worse, some of their fellow citizens, along the lines of all manner of ‘Otherizing’ constructs, race, ethnicity, nationality, color, religion and even class.

Have no doubt. In coming decades, we will watch the old paradigm cannibalize itself to death on our TV screens, tablets and cell phones. Many of us will do more than watch. We will be participant observers, victims or perpetrators, or both at once.

The only question that counts, is as follows: amidst this unfolding maelstrom, are we going to join with others to plant the seeds of viable post-carbon societies for the next generations of human-beings, or are we going to stand in the way of that viable future by giving ourselves entirely to defending our ‘interests’ in the framework of the old paradigm?

Whatever happens over coming decades, it will be the choices each of us make that will ultimately determine the nature of what survives by the end of this pivotal, transitional century.

Image above: Regardless of a sense of injustice and unfairness - if and when the pension stop coming, we will go through something like what the former Soviet Union went through in the late 1980's. A cataclysmic social convulsion and contraction that leads to a rebirth - of sorts. From original article.

A dark storm is brewing in the world of private pensions, and all hell could break loose when it finally hits.

As the Washington Post reports, the Central States Pension Fund, which handles retirement benefits for current and former Teamster union truck drivers across various states including Texas, Michigan, Wisconsin, Missouri, New York, and Minnesota, and is one of the largest pension funds in the nation, has filed an application to cut participant benefits, which would be effective July 1 2016, as it "projects" it will become officially insolvent by 2025.

For many years there existed federal protections which shielded pensions from being cut, but that all changed in December 2014, when folded neatly into a $1.1 trillion government spending bill, was a proposal to allow multi employer pension plans to cut pension benefits so long as they are projected to run out of money in the next 10 to 20 years.

Between rising benefit payouts as participants become eligible, the global financial crisis, and the current interest rate environment, it was certainly just a matter of time before these steps were taken to allow pension plans to cut benefits to stave off insolvency.

The Central States Pension Fund is currently paying out $3.46 in pension benefits for every $1 it receives from employers, which has resulted in the fund paying out $2 billion more in benefits than it receives in employer contributions each year.

As a result, Thomas Nyhan, executive director of the Central States Pension Fund said that the fund could become insolvent by 2025 if nothing is done.

The fund currently pays out $2.8 billion a year in benefits according to Nyhan, and if the plan becomes insolvent it would overwhelm the Pension Benefit Guaranty Corporation (designed by the government to absorb insolvent plans and continue paying benefits), who at the end of fiscal 2015 only had $1.9 billion in total assets itself. Incidentally as we also pointed out last month, the PBGC projects that they will also be insolvent by 2025 - it appears there is something very foreboding about that particular year.

Ava Miller, 64, and her husband, Ed Northrup, 68, could see their combined monthly pension income cut to about $3,000 from the nearly $7,000 they receive now, according to a letter they received from Central States in October.

If the cuts go through, Miller, who worked as a dispatcher in Flint, Mich., said they will need to dip into their savings to help cover their $1,300 mortgage payment, heating bills and trips to visit her 84-year old mother. Northrup, a retired car hauler, has started applying for truck driving jobs that could supplement their potentially smaller pension payments.

What makes the cuts more painful, Miller said, is that she took pay cuts so that the company could continue making contributions to the pension.

"I did everything I was supposed to," Miller said, adding that she and her husband made extra payments on their car loan to cut down on their monthly bills after they received letters in October informing them of the potential cuts.

All hope is not lost, however.

Democratic candidate Bernie Sanders has proposed a bill that would repeal the measure allowing cuts, and instead calls for the government to provide assistance to troubled pension funds.
In other words, another bailout.

Which brings us to the current juncture, where we remind everyone that the governments own safety net, the PBGC has itself become insolvent, and according to CNN, projects that more than 10% of the roughly 1,400 multiemployer plans, covering more than 1 million workers fits the current criteria to be able to apply for benefit cuts for participants.

"This is going to be a national crisis for hundreds of thousands, and eventually millions, of retirees and their families. It's going to open the floodgates for other cuts." said Karen Friedman, executive president of the Pension Rights Center.

We can't help but wonder that as more pension funds become insolvent, and more and more participants are forced to take reductions in benefits, whether helicopter money won't soon become a reality for the United States, even before it becomes one in Japan.

Especially if it is spun by some opportunistic politicians as the "only hope" for America's workers to preserve some of their retirement savings.

Opening a newspaper or listening to the radio news exposes us to a flood of catastrophic messages: devastating droughts, failing states, terrorist attacks, and financial crashes.

You can look at all those incidents as unconnected singular phenomena, which is exactly what the common presentation of news suggests. From another angle, however, they appear as symptoms of a systemic crisis, with different branches that have common roots.

But in how far are we part of a larger system? Definitely, a Kenyan peasant and a Wall Street banker; a German Secretary of State and an Iraqi policewoman have totally different living environments – and yet they are connected by a global system that ensures that the Secretary of State can drink coffee from Kenia and that the banker’s penthouse is heated with oil that flows through pipelines guarded by the Iraqi police.

This system accommodates flows of goods and financial capital as well as flows of information and ideas on how the world is and how it should be. This complex network has – like all social systems – a history. It has a beginning, an evolution and – eventually – also an end.

The Megamachine

The global system that connects us is known under various names: Some call it “the modern world-system”, others “global capitalism”. I use the metaphor of the megamachine, coined by the historian Lewis Mumford.

The modern megamachine emerged in Europe around 500 years ago in long-lasting social struggles and has spread around the globe with explosive speed ever since. From the beginning, it provided a fabulous increase in wealth for a small minority.

For the majority, by contrast, it has meant impoverishment, radical exploitation, war, genocide and the destruction of natural resources.

In the early modern era – starting in the 15th century – the foundations of a transnational trade and finance system and a global division of labour were .

However, these economic structures were unable to function by themselves. They were and still are dependent on states that can enforce property rights, provide infrastructure, defend trade routes, cushion economic losses and reign in resistance against the system’s injustices.

In the light of this, state and market are not opposite forces (as frequently claimed) but have historically emerged in a co-evolutionary manner as parts of a greater structure.

This system also encompasses an ideological framework legitimizing the forceful expansion and implementation of the system and portraying it as salutary mission. A popular contemporary example for this is the invocation of our “Western values”.

Formerly, terms such as “Christianity” (as opposed to the “pagans”), “occident” or “civilization” (as opposed to the “savages”) or “development” (as opposed to the “under-developed”) were used for this purpose. The dominant organizing principle of the megamachine is the endless accumulation of capital or, put more simply: to multiply money forever. This is something new in human history.

Before, there were many systems in which people accumulated immense riches through the exploitation of others.

There were also societies that have destroyed their own natural resources and livelihoods and thereby themselves. None of them, however – from the Roman Empire to the Mayas – was based on a never-ending accumulation; i.e. on the virtually automatic augmentation of goods and money that became an end in itself.

This bizarre logic that emerged in the early modern era is the central motor for the aggressive expansion and permanent growth that the system needs to exist. New markets and energy sources have to be made accessible by all means – including violence – and ever bigger landscapes are exploited for the economic system.

According to this logic, any pause, any deceleration or moderation is equivalent to crisis and collapse. This is why – as we will see later – all hopes that “green technology” alone will save us from ecological collapse are delusive.

In the gears of never-ending accumulation

The logic of money-accumulation has its own dynamic reaching far beyond individual greed. One example for this is the legal form of joint stock corporations that has developed around 400 years ago, constituting one of the main motors of accumulation ever since.

In private, the chairman of the board of a large stock company might be greedy or modest, a greenie or a climate-denier; but regardless of his personal preferences, his function is simply to optimize the quarterly result of the company. If he does not fulfil this function or does so insufficiently, the system spits him out.

The most powerful organizations of the world are built according to this principle. The 500 largest companies in the world – most of them stock corporations – generate half of the global GDP. Their products – cars and medicine, soothers and machine-guns, animal fodder and electricity – are interchangeable means to their real end: the endless multiplication of money.

Once the demand for certain products is satisfied, new demands need to be created. This is why it is indispensable to turn people into consumers whose contribution to social life is reduced to buying things, however meaningless, unnecessary or even damaging they may be. In this logic, there is no room for common decisions regarding the purpose and meaning of economic activities and for asking what people really need and how they want to live.

The system’s limits

In the twenty-first century, however, the five-hundred year-long expansion of the megamachine is reaching insurmountable limits.

On the one hand the accumulation-machine is stuttering: the huge numbers of poor people across the globe and the crumbling middle classes do not have the money to keep buying a growing production at profitable prices. This is why the economy is shifting to finance speculations that erupt in ever deeper crashes, further destabilizing economies as well as states. The more effectively capital owners manage to dump wages and evade taxes, the more the crisis escalates.

A massive taxation of wealth for financing redistribution and public economic stimulus programmes might be the only way to reverse this trend and get the megamachine running again.

However, this is exactly what almost all predominant forces driven by short-termed self-interest strongly oppose. But even in case of success such a new growth programme would make us feel the second limit all the faster: the destruction of our natural livelihoods.

This limit does not concern the climate alone but also our soils, our fresh water reservoirs, biological diversity, the oceans and forests that are all exposed to an accelerating process of devastation. As you cannot eat money and there will be no economic growth on a dead planet, the limits of the biosphere are ultimately also the limits of the megamachine.

The illusion of “eco-social capitalism”

Time and again it is stated that we can modify this system in a way that decouples the production of prosperity from its devastating effects.

The question is: Can there be such thing as a green, social and peaceful megamachine? The proponents of concepts like “green growth”, “a green new deal” or “blue economy” answer this question with the affirmative. Their line of argument is: If we use fewer resources for each Euro of GDP we can keep accumulating money while reducing our ecological footprint. In this way we could, it is argued, create an ethereal capitalism that is light on resources.

Undoubtedly these concepts contain some meaningful proposals, for example the deviation of investments towards renewable energies and resource-effective production. But the elephant in the room that has caused the misery in the first place – namely the logic of endless accumulation – is ignored.

In practice this leads to the illusion that we can keep the deep structures of our economy unchanged while creating the necessary change by a few technical innovations and ecological guidelines. The delusiveness of this way of thinking becomes obvious when we look for example at the boastful projection from the 1990s envisioning the transformation towards a “dematerialized” economy based on the spread of computers and the internet: less use of paper and energy, less traffic – a disembodied green service-economy.

What came out of it? During the last 15 years the commercial transport sector in Germany has increased by about a third. The Germans – in the meantime equipped with countless computers, tablets and smartphones –are still using, in addition to their gadgets, as much paper as 1,5 billion Africans and Latin Americans altogether.

Only the economic recession during the financial crisis in 2008 left a dent in this curve, which is one of the many indications implying that true ecological relief is impossible without shrinking the economy. However, in the logic of never-ending accumulation this means crisis, mass unemployment, aggravated social conflicts and state bankruptcies.

Only change is realistic

In order to escape from this dilemma we need to change the deep structures of our economy and drop out of the machinery of endless accumulation. We need economic models that serve the common good instead of profit. To achieve this we have to change not only our mode of consumption but also our institutions, the way we produce and the logic of state action.

We need a strategy for massively fostering common-good-oriented economic activities based on local and regional networks while shrinking economic sectors that are bound to the principle of accumulation and predatory exploitation. Utopian? Possibly. But certainly not out of touch with reality.

In the face of the global crises, the idea of keep going with a few cosmetic amendments appears unrealistic. In the light of the looming chaos, radical change is the only realistic option. This change will come, whether we like it or not. The only question is: how will this change look like? Who will shape it and push it in which direction?

Nothing points towards a soft transition. On the contrary, times are turning uncomfortable for more than one reason: Due to us having held on to the illusion of a green capitalism for too long, we now lack concepts for exiting the megamachine. In the meantime the global elites fence themselves in high-security gated communities and seem determined to defend their privileges by all means.

A fight for the pockets of affluence seems to be on the horizon, and in many countries authoritarian, fundamentalist and racist forces are ascending.

Because a transitional plan is lacking we have to anticipate ever more dramatic systemic breakdowns: financial crashes, ecological disasters and social crises. So how can social and ecological movements prepare for this?

In such situation the movements striving for a social-ecological transformation will only have a chance when they join forces, when they leave their niches and occupy political spaces becoming vacant along the decay of the old order.

If ecovillages and the initiatives against evictions, nurses on strike and rebelling professors unite, they might gather enough energy to become systemic. There are positive examples available, such as the Spanish “rebel cities” like Barcelona and A Coruña where municipalities were conquered by social and ecological movements.

However, as soon as such movements leave their niches, adverse winds also increase. This is because the path towards a truly common-good-oriented economy that is viable for the future is no win-win game. To walk this path means to defy powerful interests and question ownership structures.

Most people in cities for example are forced to participate in the accumulation as wageworkers in order to pay rent pocketed by a clique of real estate fat cats and funds in order to keep the wheels of the financial markets turning.

A serious transformation is unthinkable without changing ownership structures. The same applies to the struggle for decentral energy structures, other forms of mobility, food sovereignty, patent-free products and our water and health supply.

We are moving towards a new era of revolutions. It is impossible to project the final results: whether it will be a world even more shaped by injustice than today, or a more peaceful world. Only one thing is for sure: in a chaotic system even a butterfly’s flap can cause a storm on the other side of the World. It is up to all of us.

English Translation: Christiane Kliemann

This article is based on the book “The End of the Megamachine. A Brief History of a Failing Civilization” (“Das Ende der Megamaschine. Geschichte einer scheiternden Zivilisation”), published by Promedia Press in Vienna in March 2015. For more information please visit: www.megamaschine.org

Yes another Earth Day is upon us - the 37th since 1970. The significant accomplishments this "observance" or "celebration" may have had were won in the first few years. By the end of of 1970, after President Richard Nixon singed an executive order, the Environmental Protection Agency began operations to reign in the pollution of the our air, water and soil.

There was a brief period in the 1970s there was an effort by the "counter-culture" and "back-to-the-land" environmentalists searched to find appropriate technologies to replace the gas guzzling, coal burning resource draining throw-away industrial society we had become. At that time Stewart Brand was publishing the Whole Earth Catalog (http://www.wholeearth.com/index.php). It was the paperback bible to the Green Movement.

However, after a great start the Earth Day effort was passed over by other priorities. Its strongest advocates were out of college and looking for jobs. The war and Vietnam was finally over and much of the counter-culture seemed to wither away as disco music came and a red-white-and-blue American Bicentennial was being planned for 1976.

On one hand President Jimmy Carter put solar panels on the White House roof, and on the other hand he supported nuclear power even after the Three Mile Island Nuclear Power plant disaster in 1979. Even Stewart Brand became a supporter of nuclear power as the only way forward for civilization.

GREEN ROT
And so Earth Day has become an empty vessel. Environmentalism has become co-opted and transformed into a new approach to corporate consumerism and dragged the Earth Day crowd along for the ride. They do not want to hear the bad news or change what they are doing. Who does? Unless knowing the truth is required to living life in the future.

Well here we are in the future. There is no doubt now about the unraveling of the world system of industrialism, commerce, finance, food production and the resulting environmental degradation from pollution and overpopulation. The signing today of the December 2015 COP21 accord will have little to no effect on our current trajectory.

It comes down to this. What can you salvage now where you are.

Make it your responsibility to maximize the living things immediately around you - trees, birds, bugs, bees, etc.

Provide as much food, water, and energy as you can to minimize the waste stream that you produce.

Never throw away a nail, screw, bolt or nut. Keep all the spare hardware you can store. Visit the scrap metal pile at the transfer station nearest you.

Gather a library of material you will need for an offline world; How-to books, cookbooks, reference material, classics and anything of interest to you.

Keep in mind the frailty and delicacy of the current internet, cloud, and wireless technology we currently enjoy and have become so dependent on. This website is as about as ethereal as things get. The blogger technology it runs on is a service of Google. It can be interfered with, or stopped at any time.

And when it is not profitable for Google (or Bing or Facebook or Amazon) to fulfill your online request they will disappear as options and your cellphone will become not much more than a blackened drink coaster.

Image above: Dairy creamer, frozen bagels and eggs that could contain RoundUp residue. From original article.

Just how much of Monsanto’s most popular weed killer are you eating every morning for breakfast?

In an unsettling report released Tuesday by the Alliance for Natural Health, the nonprofit advocacy group details the results of a study that shows a host of breakfast foods—from cereal to eggs to coffee creamer—contain residues of glyphosate, the chemical herbicide more commonly known by Monsanto’s trade name for it, Roundup.

The report comes one year after the cancer-research arm of the World Health Organization made headlines by classifying glyphosate, which has long been regarded by U.S. regulators as posing little risk to public health, as a probable human carcinogen.

The ANH tested 24 store-bought breakfast items, including organic products, and found glyophosate residues in almost half of them.

Given that glyphosate is the most widely used agrochemical on the market, sprayed on upwards of 90 percent of staple crops such as corn and soybeans, the findings might at first glance seem like a surprise that really comes as no surprise.

But what’s alarming is that glyphosate residues were found on a bunch of products that either in and of themselves or based on their primary ingredients aren’t typically associated with heavy use of the herbicide.

Conventionally grown wheat, for example, which would be used to make whole-wheat bread, isn’t a crop on which glyphosate is often heavily applied, and you’d certainly expect organic multigrain bagels to be free of the chemical. Yet both were shown to have traces of the herbicide.

Furthermore, the ANH analysis found glyphosate in organic dairy-based coffee creamer and eggs—and the amount detected in cage-free organic eggs actually exceeded the federal government’s tolerance levels for the chemical. Overall, the results further underscore the out-of-control pervasiveness of glyphosate across the American farmscape.

So how do the results of the ANH tests compare with the federal government’s own tests of the amount of glyphosate lingering in our food? Good question.

In a classic case of the feds’ all-too-typical cart-before-the-horse approach to regulating agrochemicals, big chemical makers like Monsanto have been allowed to nearly flood the market with glyphosate for the past 20 years, yet it wasn’t until this past February that the Food and Drug Administration announced it would finally begin testing food sold in the U.S. for glyphosate residue.

Meanwhile, the level of acceptable residue, which is set by the Environmental Protection Agency, was relaxed a few years ago.

Thus, it’s hard to say how worried the average American should be about scarfing down his morning bowl of glyphosate-laced corn flakes or sipping his coffee spiked with glyphosate-laced creamer. The ANH freely acknowledges that the amounts of glyphosate found in the products it tested all fall well below the levels the federal government deems acceptable for each specific food, with the exception of those eggs.

Yet whether those levels are stringent enough to protect public health is a topic of increasingly intense debate, especially in the wake of glyphosate’s designation as a probable human carcinogen by the International Agency for Research on Cancer.

As the ANH report points out, the standards set by the EPA for glyphosate “have not been rigorously tested for all foods and all age groups.

Nor have the effects of other [chemical] ingredients in glyphosate formulations been evaluated.”

“Evidence linking glyphosate with the increased incidence of a host of cancers is reason for immediate reevaluation by the EPA and FDA,” the authors added.